In the last week, the Iran market almost started its activity but the shadow of the last days of unofficial holidays did not let us see a dynamic market. During the time, Jey and Pasargad refineries supplied bitumen and there was a balance between their demand and supply with no competition.
On April 1st, Indian refineries increased bitumen price by INR 330/MT ($4.5) while the refineries in Mumbai increased bitumen price by INR 1,330/MT (18$). As Infinity Galaxy reported in last week bitumen market report, Iran Vacuum bottom price got released by IME and increased by about 15$/MT. However, in the second half of the month, we might see a downward trend in the VB base price.
By the end of the New Year holiday in Iran, it is expected to receive bitumen inquiries in April 2021. Although there is still a shortage of containers among the shipping lines and the high ocean freights can be the main concern of buyers and sellers.
The Suez Canal blockage by Ever Given vessel was one of the determining factors of oil price last week. The Canal was blocked for 6 days and during this time, oil price followed an increasing trend. Once the ship was finally freed, the oil price started to drop.
Iran and China 25-year Cooperation Program were signed by the foreign affairs ministers of the two countries. Based on the reports of the Petroleum Economist, according to this agreement, “China will be able to buy all Iranian oil, gas and petrochemical products at a minimum guaranteed discount of 12pc to the six-month rolling mean price of comparable benchmark products, plus another 6pc to 8pc of that metric for risk-adjusted compensation”.
Based on this agreement, China agreed to inject an amount of 280$ -400$ billion into the industries of oil, gas and petrochemicals in Iran by the Foreign Direct Investment.
To the fact that this agreement was just signed on 27 March 2021, maybe it is not the right time to analyze its pros and cons. We shall wait for a while to see how it will react in the market of bitumen and other petrochemicals.